Elizabeth Earl

Elders & Youth Conference focused on power of language

Language is more than just a communication medium: it’s power. That’s the core message of this year’s Elders and Youth conference Oct. 13-16 hosted by the First Alaskans Institute at the Carlson Center in Fairbanks. The conference precedes the upcoming Alaska Federation of Natives convention, set to begin Oct. 17, also in Fairbanks. The Elders and Youth theme, “Language is Our Superpower,” focuses on the preservation and revitalization of Native languages across Alaska. In addition to cultural dance performances, plenary speakers and workshops, the conference highlights keynote speakers from various Tribes across the state: one for the elders and one for the youth. This year, there are two youth speakers — Tusagvik Oliver and Tusagvik Wilson Hoogendorn, brothers from Nome. This isn’t the brothers’ first brush with statewide attention. Earlier this year, they became Alaska celebrities when they were the first two people to summit Denali for the 2019 season, scaling the 20,310-foot peak in 14 days and skiing down in less than two. Both brothers, in their early 20s, are in college; Tusagvik is studying environmental biology at Fort Lewis College in Colorado and Tusagvik is pursuing aeronautical studies at the University of Alaska Anchorage. Tusagvik said the level of excitement about their climb surprised them when they came back down. They’d expected their family to be excited, but they found themselves receiving congratulations from all over the Native community. “It was after that, when people who we knew or that we’d known before in other Native communities … it was like the pride and what they felt about it—that’s when we started to feel pride about it,” he said. Growing up in Nome, he said the only person he could remember speaking fluent Inupiaq in his family was his great-grandmother. He remembers learning to count in Inupiaq, but they weren’t immersed in the language. He said he doesn’t speak it today, though he would like to learn. “It seems like when just one person learns a language and speaks it, or a couple of people, it doesn’t mean too much. But when you really get a lot of people speaking it and everyone’s conversing, I feel like it’s more (meaningful),” he said. “The sense of pride you get from speaking your Native language, that’s really cool.” Though he said he was excited to leave Nome when he first went to Colorado, it’s been harder and harder to go back south each time. Homesickness for him, he said, smells like the tundra and the frosty mornings of the Arctic. But overall, he says he’s glad he’s broadened his experiences. “Just like in biology, without biodiversity, the ecosystem would die,” he said. “If a person stays in the same place their whole life, they live the same routine over and over again. (Leaving) changes your point of view about what’s valuable to you in life. It’s made me appreciate home a lot more … when I left home, I never thought I was going to go back.” To the southwest of Nome, across the windswept Bering Sea, Elder Tugidaam Ayagaa Sally Swetzof has another perspective. She grew up speaking Unangam Tunuu on Atka, one of the larger Aleutian islands between Unalaska and Adak. English is still hard for her, she said; she thinks in Unangam Tunuu first. “I remember being excited to go to school, not realizing I was going to have to speak English, so as my grade school continued, I’m sure I learned it along the way,” she said. “I don’t recall the exact year. It took me forever to learn it.” As she grew up, she assumed she would have to attend high school at Mt. Edgecumbe High School in Sitka, as her sisters did. But just as she prepared to go, a high school opened on Adak Island, where the military base was. So she was able to stay closer to home; Adak is only one island over. After high school, she returned to Atka, where she worked for the school district. Eventually, she worked her way up to become the lead Unangam Tunuu instructor for K-12 at the Atka Netsvetov School. The language persevered on Atka, perhaps because the island was so remote. Swetzof recalled that her parents and grandparents spoke the language at home, and as soon as they were off school property as children, they spoke Unangam Tunuu. The children today are learning it through immersion programs the community has implemented called Where Are Your Keys, which has worked with several Native communities across the country to support language revitalization. “The difference naturally is thinking naturally in the language itself that you’re learning. If you take out a Unangam word and translate it to English, they’re continuing to think in English … the idea is to have them think in Unangam Tunuu, in the language that they’re learning, so instead of memorizing, they’ll know this in their head, hopefully,” she said. “I’ve always been an advocate for the Unangam Tunuu, and the youth is starting to realize how precious the language is and taking steps to preserve it, so I’m pleased with that.” Alaska officially recognized Native languages in 2014, and in 2018 former Gov. Bill Walker declared an emergency for Native language preservation. Individual Tribes and regions have been working to revitalize their languages through immersion programs, cultural camps and college classes. Swetzof said she thought not enough is being done and pointed to the example of the Anchorage School District, which has only one school — College Gate Elementary — that offers a Native language immersion program, which focuses on Yup’ik. Other world languages are broadly offered, but Native languages are not. Teachers may be scarce, but there are elders and speakers in the communities who could serve as resources for instruction, she said. “Without language, the culture dies,” she said. “You see that time and again. It’s going faster than we would like it to, and it’s important to stress the fact that if there’s resources out there.” The Elders and Youth Conference is scheduled to begin on Oct. 13 with a Warming of the Hands session at the Carlson Center in Fairbanks. The conference continues from Oct. 14-16 with speakers, events, dance performances and music performances. Registration on site begins at noon Oct. 13 and costs $55 for youth, chaperones and other participants; the fee is waived for elders. ^ Elizabeth Earl can be reached at [email protected]

AFN to focus on ‘good government,’ public safety, services

Thousands of Alaskans are about to converge on Fairbanks for annual Alaska Federation of Natives convention, the largest Native-focused event in the country. While the event features artisans, performances, exhibitions and awards, a major focus is also on social and governance issues affecting Native communities. The theme this year, “Good Government, Alaska Driven,” will explore what an effective state government that serves of the needs of the people would look like. Delegates also vote on resolutions at the convention that guide AFN’s policy advocacy for the upcoming year. “The theme sets our convention’s tone and guides the agenda,” said AFN President Julie Kitka in a press release. “AFN is reaching out to all Alaskans to help build an Alaska we all want to live in. That’s going to be a big part of what we discuss this year.” The two halves of the theme tie to the state government’s fiscal challenges. This year, Gov. Michael J. Dunleavy and the Legislature wrestled over the state budget for nearly seven months, disagreeing primarily over school funding, the Permanent Fund dividend, funding for the Alaska Marine Highway System and criminal justice system reform. Many of the items cut in his preliminary budget heavily affected rural Native communities, such as the Power Cost Equalization program and Medicaid. The theme seeks to discuss “the basic necessity of sound, fact-based government policy” and “AFN’s position that sensible, long-term and balanced solutions require meaningful Alaskan input through citizen engagement in the democratic process,” according to the press release. “In 2019, the Dunleavy Administration tested the bounds of this principle,” the conference agenda states. “By example, the governor’s budget and vetoes eliminated (or encumbered) the state’s obligation to provide several constitutionally mandated services. #GoodGovernment requires Alaskans—particularly Alaska Natives—to assess the quality of state government in 2020.” Following that theme is the ongoing crisis of public safety in rural Native communities. The issue drew national attention this summer when U.S. Attorney General William Barr made a visit to Alaska to investigate the lack of meaningful law enforcement. In July, he declared a public safety emergency and made $6 million immediately available to address the issue, with another $4.5 million to follow. Barr will return to Alaska for a panel at the convention, scheduled for the afternoon of Oct. 17 at 2:10. He will be joined by Republican Alaska Sens. Lisa Murkowski and Dan Sullivan. The panel will explore options to improve public safety in the villages, according to the agenda. “Despite the best efforts of a number of well-intentioned people, the state has been unable to stand up a sustainable public safety system in rural Alaska,” the agenda states. “This caused U.S. Attorney General William Barr to declare a historic federal law enforcement emergency earlier this summer. To ensure parity between Alaska’s urban and rural public safety systems, the congressional delegation and the state must work with the Native community.” Another discussion will follow the panel with Barr, Murkowski and Sullivan, the second one specifically focused on safety issues for Alaska Native women and children. U.S. Attorney General for the District of Alaska Bryan Schroder will speak, along with a handful of other law enforcement officials. The convention kicks off Thursday, Oct. 17, at 8 a.m. at the Carlson Center in Fairbanks with a performance by the Tagiugmiut Dancers. After welcoming remarks from Interior Alaska leaders and the mayors of the City of Fairbanks, the Fairbanks North Star Borough, North Pole and Anchorage, Dunleavy will address the convention at 9:05 a.m. Following Dunleavy, Speaker of the House Rep. Bryce Edgmon will speak. The keynote speaker this year, Pete Kaiser, doesn’t draw his fame from government. Instead, he drew attention across Alaska for being the first Yup’ik musher to win the Iditarod sled dog race. Kaiser was already known in his hometown of Bethel and in the mushing community as the four-time winner of the Kuskokwim 300 sled dog race, but his win in March in Nome brought out celebration among Natives both in Bethel and across the state. Other discussions on Friday and Saturday will focus on fixes for the Alaska economy, public school funding, the Tribal Child Welfare Compact, economic development, infrastructure, redistricting and unresolved land issues, among other discussions. Throughout the convention, there will be music performances, youth literary readings, dance performances and exhibitions, with delegate discussions and resolution voting on Saturday. Find a complete agenda online at the Alaska Federation of Natives’ website. Elizabeth Earl can be reached at [email protected]

House passes landmark cannabis banking legislation

A bill moving through Congress could open up a legal path for financial institutions to offer banking services to cannabis businesses. The Safe and Fair Enforcement Banking Act, HR 1595, passed the House of Representatives on Sept. 25 by an overwhelming and bipartisan vote of 321-103. The bill would prevent federal regulators from punishing financial institutions that choose to do business with cannabis establishments in states that have legalized its use. Specifically, a federal financial regulator wouldn’t be able to terminate or limit the depository or share insurance of a depository institution; prohibit, penalize or discourage financial institutions from providing services to cannabis businesses and would provide protections for ancillary businesses in transactions with cannabis-related businesses, among other protections. Federal financial regulators also wouldn’t be able to take any adverse or corrective action on a supervisory loan simply because it involves a cannabis business, an employee of one or the owner of a business working with one, according to the bill. Rep. Don Young, one of the bill’s sponsors in the House, said in a press release that his constituents highlighted the banking issue in meetings. Young, co-chair of the Congressional Cannabis Caucus, has consistently held that cannabis legalization should be up to the states, not the federal government. “When cannabis businesses are not permitted to utilize traditional financial institutions, they are forced to operate cash-only businesses, leaving significant amounts of cash out in the open and making these businesses high-profile targets for robbery and other crime,” Young said in a release. “The SAFE Banking Act is as much a public safety bill as it is a cannabis bill, and I am proud to have been an original co-sponsor of this important initiative.” Lack of access to banking is one of the biggest hurdles for the cannabis industry. Since Alaska’s industry came online in 2016, retailers have been forced to operate on a cash basis, and cultivators have had to pay their taxes in cash. In 2018, retailers conducted more than $130.4 million in total transactions, and cultivators paid more than $15.6 million in taxes, according to the Alcohol and Marijuana Control Office. Having to operate on a cash basis makes businesses more vulnerable to theft, and employees are limited in their ability to deposit paychecks earned from working with cannabis. Other financial services, like loans, are also off-limits, which hamstrings businesses from being able to operate like other retailers or farmers. Earlier this year, a handful of Alaska cannabis businesses got the chance to try a pilot program for banking through Credit Union 1, but it was short-lived. In August, the credit union announced its intentions to cancel the pilot program because a critical insurance program wouldn’t be renewed if the pilot program continued. “The Alaska Marijuana Industry Association and its members are thrilled to see the SAFE Banking Act pass the House with strong bipartisan support, and hope it will move swiftly through the Senate without hurdle,” said Lacy Wilcox, President of the Alaska Marijuana Industry Association, in a press release. A similar bill was introduced in the Senate in April with 33 co-sponsors, including Alaska Sens. Lisa Murkowski and Dan Sullivan. The Alaska delegation has generally agreed to support legislation delegating more cannabis regulation authority to states. The Senate version of the bill has not moved through hearings. Though HR 1595’s language talks about cannabis, it would also affect the hemp industry. Because of its association with cannabis — hemp is a non-THC-bearing part of the cannabis plant — hemp farmers are also not allowed to access banking services under current federal law. Industrial hemp farming itself was legalized nationally in 2018. Because of its murky legal status, hemp industry stakeholders have also reported difficulties accessing banking services. Senate Majority Leader Mitch McConnell, R-Kentucky, introduced the Hemp Farming Act of 2018, in part because of the interest in farming hemp in his home state. McConnell’s office did not return requests for comment on the SAFE Banking Act, but in previous public statements and newsletters has indicated support for banking availability for hemp-related businesses. Because cannabis is legal either recreationally or medicinally to some extent in 33 states, the District of Columbia and Puerto Rico, the American Bankers Association is encouraging the federal government to do something. The gap between federal and state law has caused confusion for financial institutions and creates risk for those who choose to provide services to cannabis businesses. “Current proposals in both the Senate and the House that seek to provide greater clarity and bridge the gap between state and federal law provide a solid starting point for discussion,” the ABA wrote in a statement. “We look forward to working with policymakers of both parties to find solutions that provide the legal and regulatory certainty banks need to best serve their communities.” The Senate is currently in recess and will return Oct. 8. ^ Elizabeth Earl can be reached at [email protected]

Launch of Goldbelt vessel a hallmark achievement for Homer

The largest vessel to be built in Homer hit the waves this fall in Kachemak Bay for its maiden voyage. The Goldbelt Seawolf, a 74 foot-long catamaran, launched from Homer earlier this month, headed for service in Southeast Alaska. Built by Bay Welding, the vessel is owned by Goldbelt Transportation Inc., a subsidiary of Juneau Alaska Native corporation Goldbelt Inc. The vessel, which took 11 months to build, will be used to transport workers to and from the Kensington Mine, which Goldbelt Transportation provides service to, as well as for other potential lines of business. Notably, though, the partners involved in the project were all Alaskan. Coast Wise Corp. of Anchorage designed the boat and Alaska Crane transported it from the shipyard in Homer to the water. Goldbelt Transportation made a point to choose Alaskan companies to complete the project, said Goldbelt interim president and CEO McHugh Pierre in a press release. “We place a high value on any ability we have to contribute to the local economy through the commissioning of in-state projects wherever possible,” he said. “In the same vein, we value Alaskan employment — every employee of Goldbelt Transportation that works in Alaska, lives in Alaska, and we are very proud of their hard work and continued success.” It’s a milestone for Homer, too. The small community, situated at the end of the road system on the Kenai Peninsula, has been working to build its marine trades industry for decades. Homer has had a robust commercial fishing fleet since the late 1930s and today is home to an extensive tourism and recreational fishing industry in addition to its commercial fishing fleet. All those businesses need boats, and community organizations and business leaders have been working to try to strengthen the industry there to provide them. Bay Welding recently expanded its space, which the Seawolf didn’t quite fit into, said general manager Eric Engebretson. “This boat was just a little bigger than our shop length-wise,” he said. “We had a long debate when we built the shop how big of a boat we wanted to put in there, and we missed it by a few feet. We made it work down to the inches. Which is nothing new for us; we have a history of using every square foot we can, every inch of height.” The business recently expanded its space with the anticipation of building larger boats, but not specifically the Seawolf, though they had heard of the project when they decided to expand. There is a market for bigger boats, Engebretson said, and Bay Welding can provide for that with the space it has now. It’s more expensive to provide shop space in Alaska, in part because competitors in the Lower 48 don’t have to have enclosed, heated shop space to do the same work. However, Bay Welding was able to offer a competitive bid to build the Seawolf and offered local knowledge. On top of that, workers are closer in Homer for future maintenance than Seattle workers would be, Engebretson said. There’s an ethos to doing business locally as well, he said. “Many of our companies are Alaska businesses or Alaska individuals … they appreciate the value of supporting each others’ businesses,” he said. “They identify with the fact that we’re here. There’s a repetitive motion of businesses doing business with each other that is self-perpetuating.” Homer has been positioning itself to be a center for boat work for decades. The Homer Marine Trades Association, an industry group that promotes Homer as a destination for boat work, has been marketing the city’s services and collaborating with the city harbor since 1994, trying to bring projects like the Seawolf to the area. The launch of the Seawolf was an achievement for the region, said Kate Mitchell with the Homer Marine Trades Association. “(Goldbelt is) a Native corporation that chose to keep their dollars in Alaska … they wanted that boat to be a symbol of Alaska manufacturing,” she said. The first cannery came to Homer in 1939, meaning there were boats fishing for salmon before that, Mitchell said. Lower Cook Inlet has had a strong commercial fishing industry for nearly a century, but the professional businesses providing boat services were not as developed. The industry began to grow as the town did, but fishermen long had to go to Seattle for professional services. By the 1970s, there were a handful of individual businesses working in the marine industries in Homer, but there was little collaboration. When Mitchell founded Mitchell’s Marine Canvas in 1978 — which would later become NOMAR — the business owners were still fairly siloed, she said. When she asked whether there was side work she could do on the interior of boats others were working on, she said she was met with confusion. “That’s just how oblique it was, that anybody would care what they were doing collectively,” she said. Slowly, the number of businesses serving both commercial and sportfishing boats in Homer grew. Today, the region features businesses offering services ranging from welding to upholstery to brailer bags. While there are still many seasonal jobs, the jobs in the marine trades tend to be year-round and pay fairly well, which helps to strengthen and diversify the area’s economy, she said. The main bottleneck to the marine trades industry is workforce development, as there’s a lack of interest in trades education among young people, she said. Homer Marine Trades has been working with AVTEC in Seward and with the university system to provide funding and education opportunities for individuals interested in going into the trades in an effort to grow interest. The long history of efforts to grow the business was part of why the industry group was so excited about the launch of the Seawolf. Bay Welding is a Homer-grown business that was able to compete for a large project, showing off the complete spectrum of work available in the area. “We, being these hippies at the end of the road, had the moxie to establish a marine trades association that markets Homer to the world,” Mitchell said. “I’m like a parent — I’m just proud as punch of what we’ve done.” Elizabeth Earl can be reached at [email protected]

SBA extends rural outreach program under 2017 tax bill

The U.S. Small Business Administration is strengthening its outreach efforts to business owners and entrepreneurs in Alaska. Last week, representatives from the SBA visited three communities on the Kenai Peninsula as part of the agency’s Rural Strong Initiative. The events were intended to connect existing businesses and interested entrepreneurs to the various services the agency provides in an effort to boost local rural economies. The initiative began as a regional program in the wake of the 2017 Tax Cuts and Job Act and spread to a national one this year, educating entrepreneurs about SBA services and offering fee relief for SBA-backed 7(a) loans up to $150,000 for rural counties. Rural communities often lose population because there aren’t as many economic opportunities for young people, and they leave for more urban areas. Strengthening the business climate in small towns may help keep people there, said Jeremy Field, the regional administrator for the SBA’s Pacific Northwest division. “The SBA is considered one of the best-kept secrets of the federal government,” he said. “The best part is that it’s free.” Businesses in rural areas face different challenges than urban ones do. While they may have less competition, there’s also fewer potential customers locally, less capital available and limitations on infrastructure like broadband internet. However, when it is available, businesses can expand their customer base to reach a variety of new customers without having to move to a central location. The federal government considers the entirety of Alaska outside Anchorage to be rural, but there are scales within the state. While the Kenai Peninsula communities are rural compared to many regions of the Lower 48, they are still far more developed than the villages and communities off the road system in other areas of Alaska. The most limiting factor in the most rural locations in Alaska is broadband availability, Field said. But even that is changing — the federal government is providing funding for private telecommunications providers to specifically expand into unserved and underserved areas to provide internet service. “(Not having internet today) is almost like not having a telephone in your community in the 1950s,” Field said. In addition to counseling services, the SBA acts as a backer for loans if a business owner has gone through advising. Field said those loan amounts can range from a few thousand dollars to more than a million, and a financial institution is more likely to offer a loan with assurance from the SBA. As they’ve gone into rural communities, one industry has jumped out as an opportunity: tourism. While it’s not an unfamiliar sector to much of Alaska, some rural areas have little infrastructure to support tourists and little familiarity with marketing. Since Alaska’s economy began to contract in 2014, the tourism industry has remained a growth area, particularly in communities with access to cruise ship ports. The number of cruise ship visitors in 2019 broke the state records; in 2020, cruise ship passenger visitation is expected to rise again. The Rural Strong Initiative also highlights export opportunities for small businesses. Alaska already has a long history of exporting materials both domestically and internationally, particularly in the seafood and mining industries. However, even smaller businesses are able to engage more in export opportunities, he said. Federal contracting is another opportunity area for rural areas. A percentage of all the federal government’s contracting has to go to small businesses through the 8(a) program, which gives small businesses a leg-up to compete with the larger corporations. It’s complicated and requires a lot of paperwork to account for the contract monies, which makes it a labor-intensive way to do business, Field said, but it can be a good way to get off the ground. Many of Alaska’s communities have an SBA office; Homer, Kenai, Anchorage and Wasilla all have their own offices. But if the local business counselor doesn’t have the specific expertise, he or she can connect clients to the right agency or expert to help them. In the case of farming, a local business counselor could help connect an aspiring farmer to the right U.S. Department of Agriculture agent, Field said. “If we don’t have a service that will help you, we’ll find you someone that does,” he said. The SBA also has specific advising programs, including a center for women-owned businesses and veteran-owned businesses, and a mentorship program for retired business owners to advise incoming entrepreneurs, Field said. The one industry they can’t offer any help on, though, is cannabis. Though the industry is legal in Alaska and still growing, cannabis is still a federally illegal substance and thus not eligible for federal assistance or traditional lines of business loans. That may change in the future if the federal government changes its position on cannabis, but for now, the SBA can’t help cannabis entrepreneurs, Field said. Even though Alaska is still coming out of a recession — oil prices are still far less than what they were five years ago and the unemployment rate is still the highest in the country — entrepreneurs can still take the opportunity to get off the ground. The SBA has historically given more loans in times of economic downturn, Field said, in part because of the attractiveness of the federal government backing the loans. “They feel alone — they don’t know all the things they need to be successful because nobody does,” he said. Elizabeth Earl can be reached at [email protected]

Marijuana board considers Outside investment in testing labs

Reversing course on an earlier policy, the state is considering allowing Outside investment in marijuana businesses. The Marijuana Control Board is seeking public comment on a set of regulations that would allow limited investment from outside the state in marijuana testing facilities. The testing facilities are a bottleneck in the state’s industry; all cannabis products bound for the retail market have to pass through a lab first. There are currently three operating testing facilities in the state: one in Anchorage, one in Wasilla and one in Ketchikan. A fourth is approved for Juneau, pending inspection, according to the Alcohol and Marijuana Control Office. One of the problems with getting more testing facilities in the state has always been the high cost of entry. In addition to the license application fee of $2,000, an operating testing facility has to employ a scientific director, who must hold a college degree in chemical or biological sciences and have a number of post-graduate scientific lab experience and conductive a comprehensive array of tests on cannabis products. The fee to renew a testing facility license is currently $2,000, but a separate proposed regulation would raise the fee to $5,000 for renewals. When the Marijuana Control Board began regulation cannabis businesses, one of the lynchpin items was that only Alaska residents could invest in or own them. Part of the reasoning was to keep an already-developed cannabis industry in the Lower 48 from swooping in and taking control of the new industry away from Alaskans. However, with limited capital available because of the state’s small population and lack of access to traditional lending methods due to marijuana’s status as a federally illegal drug, cannabis businesses have struggled to find the money to get off the ground. In 2015, the board passed a regulation allowing anyone who qualified as an Alaska voter to invest in cannabis businesses. However, the board tightened that policy later, requiring investors to qualify for a Permanent Fund dividend, a much stricter requirement. But a new regulation project would open up the opportunity for entrepreneurs applying for cannabis testing facility licenses to seek Outside investment within a number of boundaries. The Marijuana Control Board voted to send the regulations out for public comment at its meeting in Nome Sept. 11-13. The Alaska Department of Law suggested revising some of the language to make it more quantifiable than the original language, boiling it down to five conditions: whether the investor “directly contributes to improvements in the testing facility’s procedures; enables or supports hiring and retention of highly qualified employees; provides expertise not otherwise reasonably available in this state; enables the facility to obtain and maintain state-of-the-art equipment, and any other factor the board deems relevant,” according to the memo attached to the regulations. The last factor drew some attention from the board members. Member Loren Jones said he thought it was too ambiguous, allowing board members to use too much discretion. Board chairman Mark Springer said the ambiguity would provide the breadth board members would need to regulate participation in a new opportunity for investment in the industry. “We do really need the leeway to look at that investor from all sides and say, ‘Eh, maybe not,’” he said. The board also considered whether to change its policy regarding cultivator tax delinquency. During every board meeting, the members receive a packet of notices of violation — NOVs for short — that outline the business owners who have violated conditions of their licenses. Oftentimes, those NOVs have to do with cultivators who are behind on the taxes they owe to the state. Of the packet of notices the board received for the September meeting, about half were because of delinquent taxes. The main debate was whether continuing to issue notices of violation over and over again for tax delinquency is appropriate, or whether the board should look at revoking licenses. Some members suggested switching away from using NOVs for tax delinquency at all, but AMCO Director Erika McConnell said the NOVs are developed from a template and any other form of notification would be just as much or more work for staff. Board member Bruce Schulte suggested a suspension of some privileges, like transferring product, until taxes are paid rather than revoking a license. Springer pointed out that that would interrupt cash flow, which would exacerbate the problem of not being able to meet tax liability. Revoking a license would cut off the cultivator’s ability to grow or sell product to meet that tax liability as well, he said. “Especially for a small cultivator, it’s a very, very competitive marketplace, and some people as you suggested didn’t realize what they were getting into,” Springer said. “Even some standard (cultivation facilities) put a lot of investment—they either realized they couldn’t sell what they thought they could or they had crop issues.” Underlying the debate is the issue of tax structure on the cannabis industry. Cultivation excise taxes are assessed on weight alone in Alaska — as price fluctuates in the market, assessed tax obligations stay the same, cutting into cultivators’ profits. As more people have entered the industry and the prices have become more competitive, industry members have begun advocating for a change in the tax structure. The Marijuana Control Board does not have the authority to change the tax structure; that authority lies with the Legislature. Ultimately, the board agreed to continue to issue NOVs for tax delinquency, but to consider the cases of businesses that amass NOVs over time and consider taking action based on the recommendation of the AMCO director and working with the business to get on a repayment plan if possible. Elizabeth Earl can be reached at [email protected]

Schulte’s return to marijuana board restores industry influence

When the Marijuana Control Board meets this week in Nome, there will be a familiar face behind the dais again: Bruce Schulte, the board’s first chairman. Gov. Michael J. Dunleavy appointed Schulte to the Marijuana Control Board in August. The Legislature will consider his appointment for confirmation during its next session, but until then, he’ll serve in one of the board’s seats designated for a member of the public or active in the industry. That’s a change from the last time he served on the board, when he served in the seat designated for a member of the industry after helping lead the campaign to legalize recreational use. Schulte doesn’t actually have a financial stake in a cannabis business. When it was first legalized, he intended to pursue a license, but reconsidered based on the economics, he said. “I applaud the folks that have put so much time and energy and capital into this,” he said. “I want the industry to succeed, but the free market being what it is, some will succeed and some won’t. My sense is that the market is a little saturated. Already we see some people pulling out, merging forces… which is kind of what we expected to happen.” He was dismissed from the board in 2016 under former Gov. Bill Walker’s administration amid accusations of poor behavior to staff. At the time, the Alcohol and Marijuana Control Office was run by former director Cynthia Franklin, who had a somewhat combative relationship with the board and the nascent industry. Schulte said he expects to be asked about the accusations during the confirmation process but described Franklin’s behavior to the board as bullying in those days. “That led to some frustration on my part,” he said. “And rightfully so.”  In a statement provided to the Journal after publication, Franklin wrote that she was “saddened” that Schulte was engaged in “sniping about perceived slights that happened years ago.” “Although Mr. Schulte had personal power and control issues that interfered with his ability to serve in a professional manner on the board back in 2015-2016, I hold out hope that he has grown in the interim,” Franklin wrote. “Given this second chance, surely Mr. Schulte will focus on having mature interactions with the AMCO staff, industry members and his fellow board members. “In my role as director of AMCO when Alaska legalized marijuana, I did my best to balance the need to protect the nascent industry from federal overreach while giving newly licensed businesses room to grow. There were some folks determined to drive a wedge between AMCO and those new businesses, but for the most part, we managed to come together and create regulations that work for Alaska.” Franklin added that she voted for legalization and was “proud” of her work establishing the legal cannabis industry in Alaska. The Marijuana Control Board was established in 2015 after Alaskans voted in favor of Proposition 2, which legalized the recreational use of cannabis, in 2014. At first, two seats were dedicated for industry representation along with one law enforcement, one public health and one public seat. However, statutes establishing the board allowed for one of the industry seats to be a member of the public with no stake in the industry. Dunleavy initially nominated Fairbanks resident Vivian Stiver to fill a vacant seat after he decided not to reappoint industry member Brandom Emmett of Fairbanks. Industry stakeholders heavily objected to Stiver because of her earlier involvement in a citizen initiative to ban commercial cannabis operations from the City of Fairbanks. Stiver said in testimony during confirmation hearings that she intended to regulate the industry fairly at the state level, but the Legislature ultimately voted against confirming her to the seat. Dunleavy later appointed her to the board of the Alaska Housing Finance Corp. and Schulte to the seat on the MCB. The governor’s decision to appoint Schulte came after conversations with people both inside and outside the industry, said Matt Shuckerow, Dunleavy’s press secretary. Schulte’s name was included on a list of five people suggested by the Alaska Marijuana Industry Association shortly after the Legislature voted not to confirm Stiver, and while the governor ultimately chose one of the individuals on that list, he was not obligated to, Shuckerow said. “I think that the governor, in his review of all boards and commissions, has expressed a desire to have people who think innovatively, who take into consideration the different views of their communities and the whole,” Shuckerow said. “He wants someone who can think outside the box, who can bring a different perspective … My understanding on this appointment was that under Mr. Schulte’s credentials, he does qualify as a public member.” In his initial fiscal year 2020 budget, Dunleavy proposed dissolving the Marijuana Control Board and Alcoholic Beverage Control Board and consolidating the powers into the office of the Alcohol and Marijuana Control Office director. The Legislature did not accept that change, and it was ultimately removed from the budget. Shuckerow said he did not have any news about the governor’s intentions related to the boards, but that there is clearly public interest in the actions of the board, as shown by the recent public interest in proposed regulations before the Alcoholic Beverage Control Board about breweries. “More broadly, there is an examination and will continue to be an examination of boards, looking at alignment and intent and whether or not they can be changed or reformed in some manner,” Shuckerow said. “That is something that is important.” Schulte said though he’s not serving in an industry seat, he does have a clearer history of advocating for the industry than the average person. The industry has matured since the first legal sale in 2016, reaching about $130.5 million in retail sales and $15.7 million in total taxes in 2018. In some ways, that’s what early advocates envisioned, Schulte said: that cannabis would be just another industry in Alaska’s economy. There are outstanding issues facing regulators and the industry, though. At the forefront of those issues is the tax structure implemented on cultivators, which is assessed entirely on weight at a rate of $50 per pound. While advocates originally proposed that tax structure for simplicity’s sake in the initiative approved by voters, stakeholders have since raised the alarm that it will strangle cultivators as supply increases and the retail price for cannabis drops. As the price drops, the assessed tax will remain the same, as it is based on weight, cutting more and more into cultivators’ profits. Schulte said he originally supported the tax structure but now agrees that it’s a problem. However, it’s not up to the Marijuana Control Board to change it; that’s the purview of the Legislature. “As prices come down, the taxes have not changed,” he said. “In some cases, people have found that it’s impossible to be profitable. I think that that’s something that needs to be looked at. But again, the best the Marijuana Control Board can do is inform the Legislature what some of the options are and then it is up to the legislators.” On-site consumption endorsements are still an issue for the Marijuana Control Board as well, with the backdrop of a statewide indoor smoking ban complicating the landscape. The board approved endorsements in general for edible on-site consumption indoors for businesses that hold endorsements, but smoking is relegated to outdoor areas with adequate ventilation, but even that is complicated by the smoke-free workplace law. Going forward, he said he wants to see the board partner with the industry stakeholders to help them be successful in addition to being regulators. “The question I would raise in any situation is: are these folks conducting themselves appropriately in regards to regulation and statute, and what are we doing to help them be successful?” he said. “Some of these regulatory boards get too wrapped up in telling folks what they can’t do, not what we can do to make it better. I think if I were to bring any preconceived notion to the board, it would be that: what can we do to help you succeed?” Elizabeth Earl can be reached at [email protected] Editor's note: This story was updated to include a statement from former Alcohol and Marijuana Control Office Executive Director Cynthia Franklin.

Sockeye harvest breaks all-time top 5; pinks picking up

The 2019 salmon season has seen plenty of fish return to the state, but far from evenly across regions. As of Sept. 10, commercial fishermen across Alaska have landed 198.4 million salmon of all five species, about 8 percent less than the preseason forecast of 213.2 million. Most of that shortfall is in pink and chum salmon, which haven’t delivered on their forecasts so far, but a surplus of sockeye salmon helped make up for some of that gap. Statewide, commercial fishermen have landed more than 55.1 million sockeye, about 9 percent more than last year and 5 million more than the preseason forecast. The boom in sockeye salmon mostly landed in Bristol Bay, the state’s largest sockeye fishery. Commercial fishermen there landed about 43.2 million sockeye by the end of their season, eclipsing last year’s harvest of 41.2 million. The total sockeye run across the state is the largest since 1995 and the fourth-strongest season since 1975, according to a weekly harvest update from the McDowell Group and the Alaska Seafood Marketing Institute. Sockeye are still coming in, though; commercial fishermen in Kodiak landed 130,000 last week, according to the update. The sockeye harvest there clocked in at just more than 2 million fish as of Sept. 10, which is slightly less than the preseason forecast for the area. Kodiak has some of the latest sockeye runs in the state, and weaker runs tend to come in later than stronger runs, said area management biologist James Jackson. But like other areas of the state, Kodiak has seen sockeye salmon arrive near their terminal streams and hold in the salt water, waiting to enter the streams. “We’ve had sockeye holding in the Karluk Lagoon for what seems like a month now,” he said. The sockeye run hasn’t been exceptional, but the pink salmon run has done well in Kodiak this year. Pinks are the bread and butter for salmon fishermen there, and this year has brought more than 32.5 million of them so far. That’s significantly better than the total forecast harvest of 27 million pinks for 2019, and it showed up early, Jackson said. “The pink run mostly shows up in July and August, and we usually have a very small September component,” he said. “We had the fourth-largest July harvest of pinks, and the fourth-largest overall harvest of pinks, and we’re on track to have the largest September harvest ever.” The run this year never seemed to have a discernable peak, though, he said; the fish showed up early and just kept showing up. A warm summer with record-low precipitation all across the Gulf of Alaska coast, though, made escapement a little tricky for salmon, as creeks were warm and water was low. Kodiak is on track to have high escapements for pinks, Jackson said, though there will likely be some pre-spawning mortality, in part related to low water and limited oxygen. Pink salmon in other areas were slow to return early on. At the end of July, the statewide cumulative harvest was about 20 percent behind the previous odd-year harvest; as of Sept. 10, it’s only about 8 percent behind. Most of that upswing in harvest has come from Kodiak and Prince William Sound, where fishermen have harvested 31.5 million pink salmon since Aug. 8, according to ADFG’s weekly summary. “Prince William Sound Aquaculture Corporation wild stock pink salmon run entry was delayed this year, likely due to the abnormally warm weather and drought conditions in Prince William Sound,” the summary states. The low water in many creeks and warm temperatures for the majority of the summer reportedly led to many pink salmon holding offshore in Prince William Sound, delaying fisheries. The lack of precipitation in normally rainsoaked Cordova also led to a water shortage, which was compounded by the increased need at processing plants as the pink salmon season ramped up. Rain and cooler temperatures arrived across much of the Gulf coast on Labor Day weekend, bringing relief to many of the state’s parched communities. Chignik, which initially looked to be having a second summer of disastrously low sockeye returns, swung back into sockeye fishing in recent weeks as well. As of Sept. 10, 614,000 sockeye had been harvested in the Chignik Management Area, and though overall season harvest is less than than average, daily harvest is better than average for this time of year, according to ADFG’s weekly update. Participation is lower, though, in part due to fishermen heading elsewhere early in the season as the run failed to materialize. September is usually when commercial fishermen transition away from sockeye and pink salmon to coho. However, this year has presented slower returns of coho in general so far. Harvest in Prince William Sound and parts of Southeast are reportedly less than average. Statewide, fishermen have landed just more than 3 million coho, about 11 percent behind last year’s harvest. Jackson said Kodiak may see a better-than-average coho run as well, but harvest may be limited by participation. The fleet isn’t as motivated to fish for silvers if the price isn’t high enough, he said. Low water in some areas has challenged coho the same way it challenged other species of salmon. In the Mat-Su Valley, sportfishing managers closed the Little Susitna and the Deshka rivers to coho fishing effective Aug. 19 until Sept. 30 out of concern for the low numbers of coho entering the river, citing low water levels in the upper parts of the rivers. “The story of coho for 2019 is one of slower production,” said Garrett Evridge, an economist focusing on fisheries with the McDowell Group. Preliminary production numbers for coho show that harvest slowed down to about 250,000 fish last week, with the five-year average being double that. But compared to other species of salmon in Alaska, coho are not a particularly high-profile species like sockeye and king salmon, Evridge said. Elizabeth Earl can be reached at [email protected]

Proposed regs on tasting rooms tighten tensions in alcohol industry

A new set of proposed regulations has split the state’s alcohol industry: breweries, wineries and distilleries that make it versus bars, hotels and restaurants that serve it. The regulations themselves don’t have anything to do with alcohol production, service or distribution. Instead, the regulations proposed by the Alcoholic Beverage Control Board published on Aug. 26 are a revision to what’s allowed on site at taprooms and tasting rooms; the new regulations clarify the definition of “other recreational and gaming opportunities.” Breweries, wineries and distilleries are allowed to sell alcohol to consumers directly in their taprooms and tasting rooms, but with a number of restrictions: no more than 36 ounces of beer or 3 ounces of liquor per person per day, no serving after 8 p.m., no seats at the bar and no games, entertainment or televisions, among other restrictions. The regulations proposed would more closely define some of the activities prohibited, including festivals, games and competitions, classes, parties (except for private parties limited to specific invited guests), presentations or performances and “other types of organized social gatherings that are advertised to the general public.” The Brewers Guild of Alaska, which represents craft beer breweries all over the state, opposes the language of the regulations as proposed for numerous reasons, said Lee Ellis, the president of the organization and the director of operations at Midnight Sun Brewing Co. For one, the guild doesn’t agree that this regulation would be the intent of the Legislature in authorizing taprooms in the first place and would disrupt a number of operations for breweries, he said. “This would make giving brewery tours not available,” he said. “(Midnight Sun Brewing) has a first Friday art event … If we promote any sort of beer release at our brewery, that would not be allowed. That would ban other sorts of marketing.” Taprooms and tasting rooms are a relatively new phenomenon in Alaska. They were not allowed in the state until 2006, when the Legislature passed a bill to authorize them with a number of regulations like the limitations on gaming. Since then, the craft brewing industry in the state has exploded. Before 2001, only a handful of breweries existed. Today, there are dozens all over the state, many with taprooms and tasting rooms of their own. Some distribute to package stores and bars, like Juneau’s Alaskan Brewing Co., while others simply sell growlers at their manufacturing location or glasses in a restaurant, like Soldotna’s St. Elias Brewing Co. Even as overall beer consumption has decreased in the U.S., craft beer consumption has increased. In 2018, craft brewer sales by volume increased 4 percent, reaching 13.2 percent of the national beer market according to the National Brewers Association. Craft “micro” beer is also more valuable than large, “macro” beer; though it’s only 13.2 percent of the total beer sales by volume, it made up more than 24 percent of the total dollar value nationally. Some of the conflict is over whether bars and taprooms draw the same customers. The Brewers Guild of Alaska says that’s not a full picture of why bars may have seen business decline since taprooms and tasting rooms began operating, as there are a number of complicated factors in the state such as an ongoing recession, Ellis said. “I would say that our customers are driven to come to our facilities for a specific reason,” he said. “I don’t know if we didn’t exist that a bar would fill that niche for them. The way that we see it is that we are drawing out a customer that might not be going out to get a beer otherwise.” Another aspect of the conflict dates back to Alaska’s regulation structure post-Prohibition. Traditionally, there are three tiers of alcohol distribution: manufacturer, distributor and retailer. With the advent of taprooms, manufacturers have been able to bypass the other two tiers and sell directly to consumers. Glenn Brady, who owns Fairbanks-area brewery Silver Gulch Brewing Co. and serves on the Alcoholic Beverage Control Board, said the three-tier system was originally intended to keep one tier from gaining too much power over another. While the regulations seem onerous, he says they may have helped set the stage for the boom in craft breweries happening all over the country. “It’s fabulous to see the resurgence since Prohibition of local manufacturers,” he said. “A lot of people are doing interesting and unique things …. That’s the good part. The difficult part of it is that some see it as the erosion (of the three-tier system, and) some see it as a zero-sum game.” The craft beer, wine and spirits stakeholder group has grown significantly since 2006, both on the manufacturer side and the consumer side, Brady said. There were compromises made then to get the bill through, including the restrictions on activities in taprooms and tasting rooms, he said. There has been a lot of discussion since the proposal was announced, but Brady emphasized that these are just proposed regulations that are out for public comment and still have to be approved by the Alcoholic Beverage Control Board before going into effect. The public comment period runs until Oct. 4, at which point staff from the Alcohol and Marijuana Control Office will compile comments for the board members to review. The proposed regulations are a revision to an existing regulation, so the Legislature does not have to be involved to deal with it; the Alcoholic Beverage Control Board could pass a revision on its own after debate. However, the last time a controversial revision to alcoholic beverage regulation came before the board in 2017, when the board debated banning distilleries from serving cocktails in their tasting rooms, the Legislature stepped in. However, the Legislature plays a key role in another large issue facing the alcohol industry in the future: a rewrite of the Title 4 statutes regulating alcohol businesses. Legislators have been debating different versions of bills to rewrite the statute for the last three years, but disagreements among legislators and in the industry have held the bills up. The rewrite was on track to pass in 2018, but a last-minute amendment by former bar owners Reps. Adam Wool, D-Fairbanks, and Louise Stutes, R-Kodiak, that would have cut the allowable amount of drinks at tasting rooms by a third (from three to two) killed the bill before the session expired. Ellis said the BGA and the Cabaret, Hotel, Restaurant and Retailers Association, or CHARR, have been meeting this summer to discuss language for the Title 4 rewrite, working toward an agreement on revisions. “We’ve had certain legislators that very much side with bars, they’re very much concerned about them,” he said. “We’ve tried for three years in a row to get this thing through. We decided we’re going to sit down this summer and decided on language we need to change.” The proposed regulations have thrown some additional difficulty into the task of resolving the conflicts in the industry, wrote Sarah Oates, the executive director of CHARR, in an email. “While I sincerely believe that setting clear and consistent expectations and requirements certainly helps prevent confusion and frustration on all sides, Alaska CHARR has not yet taken a position on whether the proposed changes are appropriate or reasonable,” she said. Elizabeth Earl can be reaced at [email protected]

Ombudsman finds Board of Fisheries violated law on Upper Cook Inlet vote

First it was scheduled to be in Kenai. Then it was yanked back to Anchorage. Now, the location of the 2020 Upper Cook Inlet Board of Fisheries meeting is up in the air again. The Alaska State Ombudsman, which investigates complaints against state agencies, found in a report released Sept. 3 that the Board of Fisheries violated the Open Meetings Act when the members voted this past January to reconsider the location for the 2020 meeting and that the manner in which the vote was taken called into question whether chair Reed Morisky and other members “acted in good faith.” The fix? They’ll vote on the location again at the upcoming work session from Oct. 23-24 in Anchorage. A confidential complaint was filed with the ombudsman’s office in May 2019, according to the report. A draft investigation was finished in July, and the Board of Fisheries responded on Aug. 15. “The Ombudsman recognizes that the decision to set a meeting location may be, in some circumstances, a purely ministerial action,” the report states. “However, in this instance, the Board itself has noted that ‘one of the most divisive issues it faces almost every year is not a regulatory subject, but rather where to hold the Upper Cook Inlet Finfish meeting.’ As such, the Board should exercise increased diligence to ensure that its decisions on this issue are beyond reproach, to include strict adherence to the Open Meetings Act.” In a response to the findings, Morisky wrote that the board will reconsider the location at the upcoming work session, when the board normally discusses locations for upcoming in-cycle meetings, and will issue notice in accordance with the Open Meetings Act. At the same time, the board will reconsider a policy previously passed that would formally set the Upper Cook Inlet meeting locations on a rotating schedule between Palmer/Wasilla, Anchorage and Kenai/Soldotna to “determine if it has any future viability,” Morisky wrote. “It is within the board’s purview to revoke a policy,” he wrote. The Upper Cook Inlet meeting location is a perpetual source of controversy. With nearly half the state’s population and large stakeholder groups in sport, commercial, subsistence and personal-use fisheries, the Cook Inlet basin is one of the most heavily fished areas in the state. The Board of Fisheries makes allocation and fisheries management decisions that are often controversial, and the Upper Cook Inlet meeting is the longest, lasting about two weeks. Stakeholders often have to travel to the location to participate in board proceedings. Kenai Peninsula residents have been asking for the Board of Fisheries to hold a meeting on the central Kenai Peninsula for at least a decade. The last time the board held a meeting there was in 1997; the meetings have been in Anchorage since. Stakeholders contend that it is more expensive and onerous for them to travel to Anchorage, where they have to pay for hotels and travel long distances through the mountains in the winter, than for Mat-Su and Anchorage residents, who can stay at home and attend the meetings. Board members have consistently voted to keep the meetings in Anchorage, citing the expense of holding it on the Kenai Peninsula or the neutrality of Anchorage as a meeting location. At the March 2018 meeting, board members voted 4-2 in favor of holding the 2020 in-cycle meeting in Soldotna and to adopt a proposed policy to rotate the meetings on a regular basis between the three major communities of the Cook Inlet basin. However, the following January at the Arctic-Yukon-Kuskokwim in-cycle meeting, Morisky raised the issue again in the middle of the meeting and called a vote, which proceeded 4-3 in favor of moving the meeting back to Anchorage. The ombudsman’s report cites the lack of public notice on the debate at the January meeting as a major reason for the finding. “Despite the paucity of the notice given of the addition of the UCI Finfish meeting location to the January 2019 meeting, interested members of the public managed to learn of the change and travel more than 100 miles to attend,” the report states. “Then, the Board Chairperson by his own admission told representatives from the Kenai/Soldotna area that the matter wouldn’t be taken up — only to introduce the matter for a vote later the same day, after they had gone. “This not only violates the spirit and the letter of the Open Meetings Act, it brings into question whether the Board Chairperson and members acted in good faith.” The composition of the Board of Fisheries has changed since the January 2019 meeting. Former board member Robert Ruffner, who lives in Soldotna and advocated for the meeting to be held on the Kenai Peninsula, has been replaced, as has board member Al Cain, who proposed the policy that would rotate the meeting locations between the three communities. Former board member Orville Huntington has moved to the Board of Game as well. The governor has appointed three new members: Marit Carlson-Van Dort of Anchorage, John Wood of Willow and Gerard Godfrey of Eagle River. ^ Elizabeth Earl can be reached at [email protected]

Alaska hospitals take advantage of tech to coordinate care

Editor's note: This article has been updated to correct the spelling of Rachel Lieber's last name and the estimated number of hospitals in Collective Medical's network.  It’s pretty easy for patients to disappear in the labyrinth of the medical system. Alaska’s hospitals are trying to make sure that it’s much harder. By late August, more than a dozen Alaska hospitals were live on a technology platform run by Collective Medical that allows them to see a patient’s medical history upon arriving at their emergency departments. That’s somewhat novel; without it, hospitals would have to gather all the information they could from the patient and request any prior information from other emergency rooms and other hospitals to put together a medical history. “For years, I have worked in emergency departments where there is a book somewhere where there are care plans for our patients,” said Dr. Keri Gardner, the chief medical officer at Alaska Regional Hospital. “That care plan, instead of just being at Alaska Regional, will now be visible to (any hospital in the network).” Alaska Regional Hospital’s Emergency Department went live on Collective Medical’s platform in early August. It’s easy to use and embedded in the hospital’s electronic medical record system, Gardner said. The providers there recognize the value in being able to see a patient’s recent emergency room visits, prescription history and other records. Collective Medical, a 10-year-old company with about 1,000 hospitals in its network around the country, collects information from hospitals’ emergency departments and runs it through its platform, sending notifications to emergency departments where a patient is also seen to provide more information. It runs through an HL-7 interface and is Health Insurance Portability and Accountability Act-compliant, said Rachel Lieber, the northwest region manager for Collective Medical. Beyond the medical side, the system also provides another notification of interest: safety threats. Assaults and threats against emergency department staff happen all over the country, including in Alaska. Lieber said the safety notifications came up fairly early in Collective Medical’s development. “Knowing how often your staff are facing assault, aggression or violence helps you know what your staff are dealing with in the workplace,” Lieber said. How a hospital deals with safety issues for staff varies from patient to patient, Gardner said. The safety flags can also help protect other patients. For example, if an incoming patient may be a threat to other people in the emergency room, he or she could be placed in a separate room, she said. “This is a big issue in Anchorage,” she said. “The health care workers who staff emergency departments are at risk. I have personally experienced and personally witnessed injuries to emergency department workers ranging from cuts and bruises to broken bones.” Gardner pointed to the leadership of the Alaska State Hospital and Nursing Home Association in getting all the hospitals in Alaska to invest in the same platform. Lieber said Collective Medical began working with providers in the state about four years ago, around the same time that ASHNHA began its care coordination initiative. Care coordination is a key reason for choosing the program, along with improving emergency department utilization, said Becky Hultberg, CEO of ASHNHA. Other hospitals in the network have documented 15 percent decreases in emergency department utilization and 10 percent utilization decreases among frequent emergency department users. “Along with improving patient care, reducing avoidable hospital admission and readmissions and (streamlining) transition to post-acute care providers are often cited by hospitals as the biggest benefits of using the Collective platform,” Hultberg wrote in an email. Gardner said another important driver of the program is cost reduction and improved value. Being able to see which procedures and prescriptions a patient has undergone recently may inform care and reduce overutilization, especially on controlled prescription drugs. Over-utilization of emergency departments at hospitals is a major issue nationally. Emergency services are one of the most expensive ways to receive health care, but studies have shown that some individuals are visiting emergency departments more than a dozen times per year. Alaska has a handful of these individuals as well, known as “superutilizers,” who are responsible for a major chunk of the emergency room costs annually. In 2016, the top 6 percent of emergency department users accounted for 23.8 percent of the charges, or about $148 million, according to the Alaska Department of Health and Social Services. Some have suggested one of the reasons individuals may be over-using the emergency departments is that they do not have adequate access to behavioral or primary care services. The Collective Medical platform works with providers of various specialties and populations, including jail clinics and behavioral health providers, which helps connect different points in the care continuum, Lieber said. “The emergency room may be the best place to interact with some individuals that are facing housing insecurity or homelessness, or are challenged by mental health disorders or substance abuse,” she said. “Sometimes the emergency room, while we want to make sure we’re using it appropriately, might also help us start conversations with individuals who may not otherwise have access to a primary care.” Whether because of health care record privacy laws or because of insular operations, hospitals and health care organizations do not always communicate. An effort like this is helpful, Gardner said. “It’s unusual to see hospitals working together at this level, and it’s refreshing to see,” she said. ^ Elizabeth Earl can be reached at [email protected]

State continues process for behavioral health Medicaid waiver

About three years after starting the process, the state is finally moving forward with a plan to try something different with behavioral health patients on Medicaid in an effort to reduce costs. The Alaska Department of Health and Social Services has been in the process of applying for a Section 1115 waiver through the federal Center for Medicare and Medicaid Services since 2017 under former Gov. Bill Walker, which would allow the state to use Medicaid funding on non-traditional services for patients with behavioral health and substance use disorders. The waivers, which target innovative practices not usually authorized by Medicaid, are intended to help states demonstrate a way to reduce health care costs while still providing care. The origin of the program goes back to 2016, when the Legislature passed a Medicaid reform bill and directed the DHSS to apply for the waiver, said Gennifer Moreau-Johnson, the director of the DHSS Division of Behavioral Health. Behavioral health is the lynchpin to Medicaid reform, she said; without an effective behavioral health system, underlying problems driving costs will remain. But it may not necessarily fit into the same screening tools as other medical procedures like measuring height and weight. Without an effective continuum of care that emphasizes intervention, behavioral health issues escalate into crises. “If you think of Medicaid as a health care model, behavioral health doesn’t fit really neatly into the model,” she said. The federal government fast-tracked the portion of the application related to substance use disorders, approving it in November 2018 with an effective date of Jan. 1, which allowed the state to get the ball rolling on providing those services. The state is expecting approval for the behavioral health section any day, Moreau-Johnson said. Behavioral health services in the state suffer from both a lack of availability in all communities and overuse at the acute end of the care spectrum. By the time patients access services, they are typically at a critical stage, and families may be broken up as children are put into the care of the Office of Children’s Services. Inpatient services are limited in Alaska, with only a set number of beds available at Alaska Psychiatric Institute in Anchorage. The waiver targets three specific populations: children, adolescents and their parents or caretakers with or at risk of mental health and substance use disorders; transitional age youth and adults with acute mental health needs; and adolescents and adults with substance use disorders. In addition to the difficulty for patients, delivering acute care for behavioral health disorders is often the most expensive. That is a key opportunity to reduce costs, said Farina Brown, the deputy director of the Division of Behavioral Health. The waiver program helps expand the number of services that are eligible to bill Medicaid, such as the standardized screening for mental health and substance use disorders, and community-based outpatient services and mental health day treatment. That draws down federal funds to help support services that are needed or are already being provided rather than relying on state funds. In some cases, what the division has done has been to align service codes to make services clearer to bill, Brown said. The waiver is authorized for five years. However, the state has to complete a number of evaluations along the way, Moreau-Johnson said. The program has to show budget neutrality to the federal government and, in the case of the cash-strapped state government, show savings, she said. “Section 1115 waivers get evaluated to a degree that no other waiver does,” she said. “We are, for example, required to hire an outside evaluator. We also have a contract with an outside actuarial firm.” Originally, the state applied for both the behavioral health and substance use disorder components. Because the federal government fast-tracked the substance abuse portion, the state was able to get some of the components in place earlier, Moreau-Johnson said. Currently, 96 sites are operating around the state, with the majority clustered in urban areas but nine “early adopters” operating in more rural areas, she said. Capacity is a major concern. The workforce and facility availability in Alaska is already limited, and Moreau-Johnson said providers and organizations in behavioral health identified workforce as a top concern for behavioral health service expansion. The state has contracted with Optum, an outside organization that provides various services for health plans and population health management, as an administrative services organization to help offset the capacity issue. One of the key goals of the program is to help keep individuals from having to leave their communities to obtain quality mental health services, she said. “We want to reduce the number of people being treated out of state but also the people going to Anchorage for treatment,” she said. Brown noted that a recent bill passed by the Legislature also expands provider eligibility to licensed medical family therapists and licensed clinical social workers, who can provide family therapy as an early intervention. Though the cost savings are a major driver for implementing the program, Brown added that providing behavioral health care for individuals who need it should still be the purpose. “This is really about providing services to those in need, to meet folks where they’re at, helping providers serve people,” she said. “At the end of the day, this is about changing people’s lives.” Elizabeth Earl can be reached at [email protected]

Partnership mines old gold while reclaiming Fortymile

Tailings from placer mining operations a century ago have left some streams in Interior Alaska less than ideal for fish. Miners caused the damage, and now miners are trying to fix it. And in the process, they get some gold out of it. Up on Jack Wade Creek, a tributary of the Fortymile River east of Fairbanks, the Salmon Gold project is entering its second year of operation. Existing placer miners in the area are working with RESOLVE, a Washington, D.C.-based nonprofit, to re-mine old sites on the river and then reclaim the bank with vegetation, restabilization and restored river structure. The goal is to make the rivers more habitable for fish — not just salmon — and to pull out some of the remaining gold in the process. The project just delivered its first batch of gold to refiners, on its way to companies like Apple and Tiffany &Co. So far, it’s only produced about 1,000 ounces among three sites, but RESOLVE and the miners hope to scale it up into a self-sustaining operation in the future, said President Stephen D’Esposito. The project dates back to when he spent time in Canada and saw some of the damage in creeks that had hosted placer mining in the past. “It was the first time I had seen placer and the historical impacts of placer mining — sediment in streams, that kind of thing,” he said. “And about four years ago, when I was doing some work in Alaska, talking to mining industry people, conservation groups, I hadn’t really known that there was a historical impact of placer mining (in Alaska). My thought was if you could pull the gold back out of the tailings and work hard at reclamation, that could be a really interesting combination.” RESOLVE is a nonprofit, and operating mining equipment is expensive. D’Esposito said he quickly realized buying equipment and running its own mining operation wouldn’t be economically feasible, so instead began to look around for partners. The U.S. Bureau of Land Management was already working with placer miners on federal lands on how to allow mining operations while mitigating damage and restoring fish habitat. Dean Race on Jack Wade Creek, Peter Wright on Sulphur Creek in the Yukon Territory and Tod Bauer on Gold Creek near Talkeetna are partnering with the project so far. Through the BLM, D’Esposito said the organization was able to find three miners to work with on Jack Wade Creek, Sulphur Creek and Gold Creek. Operations began in 2018, and though they weren’t expecting to recover any gold that year, they were able to extract about 50 ounces from the Fortymile River drainage. By comparison, the Fort Knox Gold Mine near Fairbanks produced 255,569 gold-equivalent ounces in 2018, according to the Alaska Department of Natural Resources. The production volume was never going to be extremely high, D’Esposito said — the main goal is to find ways to reclaim stream habitat for fish, and the gold can help provide marketable support for that. “In stage one right now, it’s commercial in certain aspects, but it’s mostly philanthropic,” he said. “In the second stage we get to, as we scale up, RESOLVE will keep raising money to figure out how it can work, and we need to find long-term funding sources.” Tiffany &Co. and Apple also help supply some of the funding at this stage, D’Esposito said. As they go forward, the companies hope to scale up to other streams and other miners, allowing the project to become self-sustaining. But at the same time, the companies and miners recognize that the process and model is still experimental, he said. It may also be a step forward on another front: compensatory mitigation. Under the Clean Water Act, all mining companies have to perform offsetting mitigation measures to compensate for the loss of or adverse effects on aquatic resources or habitat. In the past, mining companies have taken such actions as buying land and setting a conservation easement on it, which will prevent it from being developed. But in a case like Salmon Gold, the re-mining of old placer mining sites and the stream reclamation along the way may be able to be counted as a sort of bank for compensatory mitigation purposes, said Steve Cohn, the former state deputy director for resources for the BLM in Alaska. Under the Clean Water Act, some operators act as “mitigation banks.” Essentially, a party can purchase a damaged site and restore it, and work with the U.S. Environmental Protection Agency to then sell compensatory mitigation credits in connection with that restoration. How many credits the work is worth is up to an interagency review team, but developers who need to account for compensatory mitigation for a project may buy those credits to offset adverse impacts. “(Miners) are required to reclaim, but there’s a difference between reclaiming a site … and restoring it,” he said. “There’s a delta in there, and that delta could be turned into a profit. It hasn’t really materialized yet, but it’s one of the ideas that’s hopefully still being explored.” Cohn said there has been a history of tension between miners and the BLM over standards for reclamation, particularly in areas of the Fortymile River, which has more than a century of mining history but was also designed a Wild and Scenic River by Congress in 1980 in a number of places. Wild and Scenic River designations limit some development activities. In an effort to work with the miners and to restore some of the fish habitat, the BLM began convening meetings with stakeholders through the Resource Advisory Council. “I feel like the miners are very well-intentioned people and they’re willing to try different things if it makes sense to them and it fits within their business model,” Cohn said. “(The Wild and Scenic designation was) almost set up for conflict. It really set up the BLM and the miners to be in conflict in some ways. Both entities have tried hard to find some middle ground, and that resource advisory council really helped serve as a mediator.” D’Esposito said as the project moves forward, RESOLVE will be working on bringing additional placer miners interested in reclamation work in, and how to coordinate the differences in sites as it expands to different creeks. The suppliers are interested, placer miners showed support as well. “There’s an appetite, there’s a hunger out there for this kind of project, which is interesting,” he said. “I’ve really been quite impressed with the placer miners, how interested they are in this working. Even though I think people were skeptical that this would actually produce gold, they’re rooting for us.” Elizabeth Earl can be reached at [email protected]

Drought and dry conditions impacting salmon across state

This summer has been hot and dry in Alaska — so hot, in fact, that even the fish are feeling it. All over coastal Alaska, temperatures have hovered significantly greater than normal. The state began sweltering in mid-June and crested on July 4, with Anchorage hitting 90 degrees Fahrenheit and Bethel reaching 91. The bright, sunny days brought Alaskans out to swim and recreate, but they also left the waters where salmon were returning exposed to the direct, unforgiving heat. Shallower lakes and rivers across Southcentral and Southeast Alaska were the first to heat up. In the Matanuska-Susitna Valley, lakes like Larsen and Judd, where the Alaska Department of Fish and Game operates weirs for sockeye salmon, reached 80 degrees. The Kuskokwim River in western Alaska registered water temperatures about 10 degrees greater than normal, likely contributing to a reported salmon die-off as the fish headed upstream. On the lower Kenai Peninsula, the Anchor River hit its warmest temperature on record on July 7: 73 degrees. It’s dropped since then to about 66.2 degrees, but the spike was troubling, said Sue Mauger, a scientist with Homer-based conservation nonprofit Cook Inletkeeper. The lack of rain has contributed to the temperature increases too. “I think (the snow) melted out fast,” she said. “It takes a really long time for that volume of water (after a rain event) to warm up again … a rain event can be really significant in these streams.” Mauger runs a network of stream temperature monitors on 48 creeks around the Cook Inlet watershed through Cook Inletkeeper. Of the four streams she monitors in real time — the Anchor, the Russian River, the Deshka River and Crooked Creek, near the Kasilof River — all have been above normal temperatures except for the Russian River. Though the Russian is a clear water river, it’s likely buffered by its connection to two large, deep lakes at higher elevations near Cooper Landing. The Deshka’s elevated temperature — more than 81 degrees Fahrenheit on July 7 — was troubling to more than just people. July is normally the height of the king salmon return to the Deshka, but from July 1 to 9, a total of 13 individual king salmon passed the weir, according to Fish and Game. Numbers increased afterward, with nearly 2,000 passing from July 11 to 17, but soon plummeted again. ADFG has also closed fishing for silvers on the Deshka and Little Susitna rivers until the end of September. “As soon as the temperature dropped a little bit, hundreds were coming in,” she said. “Clearly, we are seeing the behavior of holding in cooler water.” In Prince William Sound, managers reported having slow escapements of pink salmon but reports of large aggregations of fish milling in the salt water, which made it difficult to plan fishing periods, as the management systems are based on inriver escapement. Prince William Sound does not currently have any offshore test fisheries to gauge salmon return indices in the marine waters for fishing periods, so managers and fishermen were stuck waiting for salmon to be ready to head up the creeks. The one exception has been glacially fed creeks. Not only are water levels relatively normal or high on glacial river systems, their temperatures are also closer to normal. The Copper River experienced record water levels on both ends of the spectrum this year — it was the lowest recorded level ever when Fish and Game put in the sonar in the spring and it hit its highest level ever later in the year — but the temperature has been relatively closer to normal, said Stormy Haught, a research biologist with the Fish and Game commercial division in Cordova. “Any glacial streams are doing much better than groundwater, rainfall streams,” he said. “Part of it is snowpack; we’ve had a lot of hot weather so there’s just not a lot of source for these streams. Copper River has been high and doesn’t seem like any major temperature anomalies this year.” The groundwater and snow-fed systems are low, and some are simply drying up. In Prince William Sound, dewatering is relatively normal for some systems; on Montague and Hinchinbrook islands, some short streams can dry up even in wet years, Haught said. However, even normally stable creeks are experiencing extremely low water levels. In Southeast, the Stikine River’s most recent discharge level was below the 25th percentile, according to the U.S. Geological Survey; the Situk River near Yakutat is below its lowest recorded discharge level, as of Monday. Most of Southcentral and Southeast Alaska are officially in drought stages, according to the National Integrated Drought Information System. About 21 percent of the state is abnormally dry, but not officially in a drought, while some areas in southern Southeast are in extreme drought as rain continues not to fall. In Cordova, a city that usually receives about a dozen inches of rain even in the summer months, public works officials have been urging people not to water their lawns, wash their cars or water down the dust on the dry roads. Public Works Director Samantha Greenwood said it’s a game of trying to keep up with the salmon processing plants, which are now receiving some of their largest deliveries of pink salmon all year. The processors can use millions of gallons of water per day to keep up with operations, and the city can only process so much a day. “I send an email to the processors, who’ve been great at trying to turn water off whenever they can,” she said. As of Aug. 19, fishermen in Prince William Sound had harvested about 30.2 million pink salmon in one of their strongest weekly harvests so far this season. But as the sun continues to shine, Cordova’s reservoirs are dropping now, unable to be recharged by lakewater. The city’s website asks residents to conserve water as much as possible. Upstream, with the low water levels and high temperatures, salmon may be entering a difficult environment. In Bristol Bay, salmon die-offs were reported in the Igushik River in June, likely due to hypoxic conditions as salmon packed into the river and would not pass upstream through pocket of warm water. As more salmon pack into less water, they deplete the oxygen supply and can suffocate. Because pink salmon tend to spawn low in the river systems or in the intertidal zone, they may do fine in Prince William Sound, Haught said. “The beauty of salmon is that they have these (variable) life histories, and that’s what helps them survive these environmental events,” he said. “That said, yeah, it’s fairly ugly out there. A fish can’t swim into a stream if there’s no water.” Mauger said it’s hard to know if salmon will have spawning success, even if they were counted on weirs — there may have been enough water downstream, but maybe the spawning grounds were cut off or too shallow. The low water levels are also leaving gravel bars — prime salmon spawning habitat — high and dry, she said. And if the water levels continue to drop after salmon have laid their eggs, exposed eggs will dry out and die as well. Cook Inletkeeper produced projections for water temperatures in different case scenarios for climate change in 2004, projecting out to 2069. This summer saw the Deshka’s water temperature crest above what the models predicted would happen by 2069, Mauger said, putting the temperature increases 50 years ahead. “I think it’s important that people realize that this is the new reality of where we are and where we’re headed,” she said. ^ Elizabeth Earl can be reached at [email protected]

Sockeye harvests wind down; pinks and chums slow going

As Alaska’s salmon fisheries transition away from sockeye and kings to pinks and chums, the harvest results so far look mixed. May, June and July are the main harvest months for sockeye salmon across Alaska, beginning in Prince William Sound and reaching a crescendo in Bristol Bay throughout July. The Alaska Department of Fish and Game forecasted a total sockeye harvest of 41.7 million sockeye salmon for the 2019 season. Some sockeye are still being harvested, but as of Aug. 11, the count stood at 53.7 million sockeye, more than 43.1 million of which came from Bristol Bay. Bristol Bay’s harvest blows away even the large harvest from 2018 of 41.7 million, though it didn’t quite reach the all-time record. The Prince William Sound harvest is about 2.5 million sockeye, and the Cook Inlet harvest is about 1.9 million as of Aug. 13. The Kodiak harvest was about 1.64 million as of Aug. 13. While Prince William Sound’s sockeye harvest is close to its preseason forecast, Upper Cook Inlet fishermen are about 1.5 million fish shy of their preseason forecast of about 3 million sockeye. Constrained by low late-run king salmon returns to the Kenai River, managers closed setnet fishing in the Upper Subdistrict on the eastern shore of Cook Inlet on Aug. 5 and Aug. 8, with a possibility of reopening if king salmon escapements improve on the Kenai. The closure continued Aug. 12 for Upper Subdistrict setnetters. The drift fleet was scheduled to fish its normal period. “Kenai River late-run king salmon escapement will continue to be monitored on a daily basis and if escapement projections estimate the SEG (sustainable escapement goal) will be achieved, the Upper Subdistrict set gillnet fishery may be reopened,” the closure announcement stated. The commercial closures to shield kings come at the cost of exceeding escapement goals in the Kenai River; as of Aug. 12, more than 1.7 million sockeye had passed the sonar in the Kenai, about 400,000 fish more than the upper end of the in-river goal and 500,000 fish more than the upper end of the sustainable escapement goal. The Kasilof River sonar has counted about 376,184 sockeye as of Aug. 11, greater than the upper end of the biological escapement goal for that river but still within the optimum escapement goal. And so far, pink and chum results across the state are tepid at best. The statewide preseason forecast predicted a rosy harvest of 137.8 million pinks and 29 million chum, which would have been a record chum harvest. Though pink harvest has been good in Kodiak so far — as of Aug. 13, fishermen there are on their way to the preseason forecast of 27 million with 14.4 million harvested so far — it hasn’t lived up to expectations in Prince William Sound yet. As of Aug. 12, only 17.6 million pinks had been harvested in Prince William Sound. At this point, nearly 25 million pinks would need to be harvested per statistical week through the end of the season to reach the forecast, and the odds of those numbers appearing are relatively low. Warm weather and drought conditions in Prince William Sound may be holding back escapements, though. Purse seine commercial fishery manager Charles Russell said the escapements of pink salmon into streams across the region have been delayed as fish shy away from the extremely warm water in creeks, waiting for temperatures to cool and rain to fall. “We were already in a drought scenario moving into the season, and that heatwave just exacerbated the situation,” he said. “In the low water and extremely warm water temps we were seeing around the sound, salmon were holding offshore. They didn’t have any urge to move into stream mouths like they typically do. It’s delayed the fisheries here. Obviously, we manage on escapement in streams, and if we don’t get escapement in streams, it’s hard to justify a fishery.” Catches are improving, though, after a slow start. The aquaculture associations have met their cost recovery goals and escapements are catching up, Russell said. However, with underperformance from the Solomon Gulch Hatchery — the run is estimated to finish at about 10 million to 12 million pinks as opposed to the 20 million forecasted — it seems unlikely that the area will reach its preseason forecast of 64 million fish, he said. Chum runs look likely to disappoint, too. Southeast Alaska’s salmon hatcheries had collectively projected about 10 million chum salmon to be harvested in that area, courtesy of a large parent year return. However, that run has yet to materialize, and at this point seems unlikely. As of Aug. 9, commercial fishermen had harvested about 2.5 million chum. “Based on our harvest so far, it looks like we’re going to have one of the lower harvests since the program for chum salmon began,” said Andrew Piston, a research biologist with Fish and Game’s Division of Commercial Fisheries in Ketchikan. “Over the last decade, (the chum harvest) averaged about 10 million, and the way things are shaping up, we’ll be lucky to get about half that.” It’s hard to say what happened to the chum salmon that were predicted to come back this year. The forecasts for chum are produced by the hatcheries, which collectively produce about 90 percent of the chum harvested in Southeast Alaska. The wild stocks are returning in decent numbers, but the hatcheries are having trouble harvesting enough chum, Piston said. Southeast is about on track to meet its forecasted pink salmon harvest, Piston said, but that wasn’t high to begin with — about 18 million pinks total. There has been very little opportunity in northern Southeast, which is divided roughly at Sumner Strait near Wrangell, but southern Southeast has harvested about 9 million pinks as of Aug. 12. The low abundance of hatchery chums wouldn’t change ADFG managers’ fishing strategies for the commercial fleet, Piston said; as long as the wild stocks are meeting their goals, they’ll continue to fish as normal. “We wouldn’t not let our fishermen fish on wild stocks because there aren’t enough hatchery fish,” he said. Though it’s struggling for pinks so far, Prince William Sound is doing just fine for chum salmon — about 82 percent greater than last year’s catch, and above the preseason forecast of about 2.8 million. As of Aug. 13, just shy of 5 million chums had been harvested in Prince William Sound, according to ADFG. Russell said the hatcheries were expecting a good harvest this year based on past returns, and the same pattern played out with chums as with pinks — many fish were caught milling around in the sound. As of Aug. 12, fishermen across the state had harvested just more than 120.7 million salmon. ^ Elizabeth Earl can be reached at [email protected]

Juneau Assembly gives greenlight to on-site consumption

Editor’s note: This article has been updated to clarify the American Lung Association’s position on marijuana smoke. Cannabis retailers in Alaska’s capital city will soon be able to offer spaces for customers to consume cannabis in their stores. The City and Borough of Juneau Assembly approved an ordinance last week allowing licensed marijuana retail shops to legally open on-site consumption areas. Within Juneau, smoking will be allowed in outside areas only, while edibles can be consumed indoors or outdoors. The Assembly had been discussing it for a few months, following the Marijuana Control Board’s approval of a regulations package. Lt. Gov. Kevin Meyer signed the initial regulations into law in March, allowing retailers to work on their applications for on-site consumption endorsements to be added to their licenses. The regulations became effective April 11. However, no one has made it through the rigor of the application process yet. The Alcohol and Marijuana Control Office has received two applications so far, one of which from Fairbanks has gone to the board and was denied at its July meeting, wrote AMCO Executive Director Erika McConnell in an email. The board still has an open regulations project about on-site consumption, which is set to go before the members at the September meeting, she added. “Since the adoption of the initial regulations, some issues have arisen that need clarity, so the board has opened a new regulations project to do some ‘clean up’ to those regulations,” she wrote. “That project remains open and a revised draft will be provided to the board at the next meeting.” Under proposed regulations, any retailer can open a consumption space for edibles, but in order to have an outdoor smoking space, the building has to be freestanding. The applicant that was denied, the Fairbanks Cut, made a case to the board that its building is in fact freestanding, as it’s not supported by any other structure and the only other occupants are the landlords. Correspondence from AMCO staff noted that the application would be recommended as not meeting the freestanding requirement. “We have an agreement with them that our on-site consumption area will only be open when their office hours are closed,” wrote owner Lily Bosshart in a letter to the board. “As such, on-site would be open Monday-Friday from 5:30 p.m.–Midnight, Noon–Midnight Saturday and Sunday. We share the building in a collaborative way and are both on-board with a small on-site area to be built in the parking lot.” There are a number of other particulars with the on-site consumption endorsements as well, mostly for those who wish to open smoking areas. The regulations require that an outdoor smoking area also include a ventilation system, directing the air outside the building and eliminating the odor by the time it reaches the property line. But the practical application of a ventilation system for an outdoor facility that allows smoking is still a little unclear. The Legislature passed a statewide ban on smoking in workplaces in 2018 as well. That complicated the debate about whether an indoor smoking area for cannabis was legal, whether the business wanted to allow it or not. During the Juneau Assembly’s original debate, City Attorney Robert Palmer noted that if the assembly wanted to allow on-site cannabis smoking but not tobacco, the members would have to make a meaningful distinction between cannabis and tobacco. Before passing the ordinance on July 22, the Assembly members did have a fairly extensive debate to help clarify the differences. Palmer said he thinks the city is fairly clear, given that the memo outlines the various ways this ordinance differentiates marijuana from tobacco. The outlined points include items like consuming marijuana outdoors still protects workers, complies with indoor secondhand smoke laws in protecting the public, and serves the public interest by providing cruise ship passengers with a legal place to consume. Juneau’s sizeable cruise ship population currently has nowhere to go. “The big picture is that the assembly in Juneau decided that the smoking of marijuana at licensed retail stores is something lawful they want to allow,” he said. The main opposition to the legalization of on-site consumption came from the public health community and neighbors concerned about odor and smoke. The American Lung Association in Alaska says exposure to neither tobacco nor marijuana smoke is safe, said spokesperson Ashley Peltier in a written statement. “To fully protect our public health, we support and advocate for smokefree indoor and outdoor environments, and believe that everyone has the right to breathe smokefree air, which includes air free from marijuana smoke,” she wrote. Elizabeth Earl can be reached at [email protected]

Kenai River sockeye push liberalizes bag limits; commercial catches rise

SOLDOTNA — After a slow start to their season, things are looking up for Upper Cook Inlet’s commercial fishermen. Total salmon landings reached 1.4 million after the July 29 fishing period, with more than 1.1 million sockeye so far. The majority of those landings have come from the Central District drift gillnet fleet and east side setnets, with setnetters on the west side, Kalgin Island and in the Northern district bringing in about 150,000 salmon between them, according to the Alaska Department of Fish and Game. It’s hard to say whether the forecast of 6 million sockeye across all the systems of Upper Cook Inlet will materialize yet, but it’s definitely looking better than it was a few weeks ago, when Upper Cook Inlet fishermen were lagging significantly behind even their 2018 catch by this date. Last year was one of the worst years in recent memory for sockeye harvest for fishermen across the Gulf of Alaska, Cook Inlet included. On July 26, fisheries managers in Soldotna estimated that the Kenai River run is 2 to 4 days later than usual, but that it will likely be greater than 2.3 million. That’s on track with the preseason forecast of about 3 million. That’s much more on time than last year, when the run turned out to be at least a week later than usual. Even a run four to five days late can significantly interrupt fishing management plans in Upper Cook Inlet, where the interlocking user groups and their management plans keep operations fairly tight. The Kasilof River, about 12 miles to the south of the Kenai, is getting close to the upper end of its own escapement goal of 340,000 sockeye. As of July 29, 306,812 sockeye had passed on the sonar on that river. Commercial area management biologist Brian Marston said the managers will likely start opening up more hours in the Kasilof area to help control that escapement, with an eye toward not having to open the Kasilof Special Harvest Area. “We have several steps that we’re supposed to take before that, which is to use more hours than the management plans normally allow and also to not adhere to the (mandatory closure) windows,” he said. “The SHA is a last resort. The management plans actually state that you shall do extra hours and step on the windows before you do the SHA. Although it’s a good idea, it doesn’t function to really stop the river that well.” The SHA is a constrained terminal harvest area around the mouth of the Kasilof River, functioning as a last effort to control escapement to that river. Because of the tidal flats and constrained area, it’s relatively hard to fish. During the 2017 Upper Cook Inlet Board of Fisheries meeting, the board members took several steps to help managers avoid having to use the SHA to control escapement, including expanding opportunities for the use of the 600-foot setnet fishery along the nearby beaches. The Kenai River is already within its sustainable escapement goal range, and as of Monday was within the inriver goal range of 1 million to1.3 million sockeye. The sustainable escapement goal is set for spawning; the in-river goal is designed to account for sportfishing harvest. Now it’s a game of controlling escapement to not exceed the upper end of the escapement goal using the commercial and sport fisheries. But one confounding factor is the king salmon run there. The kings are still returning to the Kenai, but only 8,615 large kings had passed the sonar as of July 29. The lower end of the escapement goal for late-run kings is 13,500. In trying to protect kings, the commercial area managers are somewhat hamstrung when trying to open setnets to harvest sockeye salmon in the Kenai River area. After Aug. 1, the managers get more hours as the restrictions on commercial fishing hours through the Kenai River Late-Run King Salmon Management Plan are lifted, Marston said. “As soon as we get out of the king plan at the end of the month, we have to still pay attention to the escapement of king salmon,” he said. The Kenai River personal-use dipnet fishery closes on July 31 at 11:59 p.m. as well. Sport anglers will keep fishing, and ADFG sport fishing managers doubled the bag and possession limits to six per day with 12 in possession for the Kenai River downstream of Skilak Lake effective Sunday. They also increased the bag limits for sockeye in the Kasilof River Effective July 24 to six per day with 12 in possession. The personal-use dipnet fishery there will continue as well until Aug. 7. Pink and coho salmon are starting to show up as well, though this year is set to be a relatively weak pink year, as odd-numbered years are in Upper Cook Inlet. As of July 29, commercial fishermen had landed 83,307 coho salmon across Upper Cook Inlet, and though there are no escapement goals for coho salmon south of the Deshka River, Marston said there were signs the run could be strong this year. The Deshka River weir has counted 826 coho salmon as of July 29, ahead of last year on the same date. The northern streams are on target for their coho runs so far, and strong numbers have been showing up at Fish and Game’s weirs since the rain began last week. The run could still turn out to be unexceptional, as coho didn’t show up strongly in the test fishery numbers, but it could also be another excellent year, he said. ^ Elizabeth Earl can be reached at [email protected]

Bristol Bay sockeye harvest blowing away forecast once again

Bristol Bay is approaching the record for sockeye salmon harvest once again. As of July 21, fishermen in Bristol Bay’s five districts had harvested just more than 42 million salmon. More than 41.5 million of those were sockeye, according to the Alaska Department of Fish and Game; that’s already more than the 41.3 million sockeye harvested in 2018, the second-largest harvest on record. The largest harvest on record, which occurred in 1995, still stands at 44.2 million sockeye. The total return so far is about 53.6 million sockeye, significantly fewer than the record-breaking run of 62.3 million fish last year but already beyond the upper end of the preseason forecast range of 27.9 million to 52.4 million. Fishermen in the Nushagak district have been leading the area for total catch, but the Egegik isn’t far behind; both have topped 14 million sockeye. Bristol Bay west side area management biologist Tim Sands said he expects Egegik to catch the Nushagak area for total harvest soon. Fishermen in the Nushagak district, at least, have become more efficient in selecting their gear in recent years, which may be helping to boost the catch, he said. “The last two years we’ve had these really tremendous runs of two-ocean fish here in the Nushagak,” he said. “People probably saw fish going through their gear. I think there’s definitely been some learning going on.” So far, the processors in the region have been able to handle the landings without too much difficulty, he said. Fish are coming in relatively steadily, and with a reported price so far of $1.34 per pound on average, fishermen are poised to do fairly well this season again in Bristol Bay. However, there have also been some odd hallmarks to this season. June brought bright sunny days that led to skyrocketing water temperatures across Alaska, which can be bad news for salmon. Dead salmon have been reported floating in rivers in Norton Sound and in the Kuskokwim River. In Bristol Bay, warm water seems to be preventing salmon from moving upstream in at least one system: the Igushik River, a broad river on the western side of the Nushagak District. Sands said many systems across Alaska have seen salmon kills due to heat, including the Nushagak, but the Igushik in particular is having large numbers of them because warm water is blocking salmon from moving upstream. “The Igushik River itself is kind of an interesting river,” he said. “It’s really slow, a lot of tide and not a lot of flow. It’s more like a really long pond. Because of that, it’s much more susceptible to heating up. The warmer the water is, the less oxygen can dissolve in it. There’s a bunch of fish in the river holding, there’s less oxygen available.” Though other areas of Alaska aren’t quite having Bristol Bay’s luck for large sockeye returns, things aren’t going as poorly as last year. Prince William Sound fishermen have landed about 2.3 million sockeye as of July 21, with just shy of 1.2 million of those coming from the Copper River district. That’s about 300,000 fish more than the preseason point forecast of 955,000 fish. Fishermen in Prince William Sound are now shifting attention to pink salmon, which are forecasted to arrive in numbers close to 23 million between hatchery and wild production. Chignik has reported no landings so far this year, but that’s not because no fish are coming in; it’s because there aren’t enough processors in the area to require public disclosure of landing data. Dawn Wilburn, the area management biologist for salmon and herring in the Chignik Management Area, said the two processors taking fish in the Chignik area this year have not signed voluntary waivers for the disclosure of fish landing information, and by law, ADFG cannot disclose that data without them. There hasn’t been a lot of harvest yet anyway, she said. But the sockeye run does at least look better than last year, which brought a disastrously low run to Chignik and prompted a request for disaster support in the area. She said the Chignik River has not experienced the elevated temperatures other river systems in the state have, and there have been no fish die-offs reported there. “It’s a lot better than last year,” she said. “Our early run was pretty weak, and our late run is looking OK.” Things are still slow in Upper Cook Inlet, where fishermen are in the middle of their sockeye season. As of July 24, they’d harvested a total of 824,351 sockeye, about a quarter of the preseason forecast of 3 million sockeye. Sonar counts on the Kenai River are tracking ahead of 2018 and 2017 so far, with 525,936 sockeye having passed the counter as of July 24. The Kasilof River is tracking ahead of 2018, 2017 and 2016, according to ADFG sonar counts, with 238,463 fish having passed the counter as of July 22. Lower Cook Inlet should be ramping up soon, with pink salmon beginning to arrive in the various creeks and bays near Homer. Some of the creeks host sockeye and chum runs as well, with sockeye coming both from wild production and from the Cook Inlet Aquaculture Association’s hatcheries. As of July 22, fishermen had harvested 194,476 sockeye — with 120,823 of those coming from the predominantly hatchery-produced run in Resurrection Bay — and 128,026 pink salmon. The forecast predicts about 2.4 million pinks to be available for commercial harvest district-wide. So far, ADFG hasn’t spotted any fish kills in aerial surveys of the Lower Cook Inlet streams, said Glenn Hollowell, the area management biologist for commercial salmon and herring fisheries in the area. Water temperatures may be a little cooler in the area due to cloud cover and smoke so far, he said. “I am concerned about warm water when they do show up and start moving into the rivers in big numbers,” Hollowell said. Resurrection Bay’s sockeye salmon run has actually significantly underperformed so far — though 120,823 sockeye have been harvested, that’s only about half what the Cook Inlet Aquaculture Association projected it needed to harvest for cost recovery. The hatchery organization is still harvesting some fish at its Bear Lake weir, but those fish are not the same quality as the fish harvested in marine water and may not be able to be sold to the processor, said Dean Day, the executive director of CIAA. The organization tries to work around the recreational fishery in Resurrection Bay, which can hamper commercial fishermen as they try to harvest the sockeye for CIAA, Day said. ADFG raised the bag limit for sockeye in the Resurrection River this year from 6 to 12 per day because too many were making it upstream. He said CIAA may consider doing a creel survey on recreational fishermen in Resurrection Bay in the future to quantify how many fish are being taken in the sportfishery there, as the only data available now is the voluntary reporting ADFG collects in the annual Sport Fish Harvest Survey. “In the next couple of weeks I’ll be able to have a pretty good number on what we can estimate was our total return,” Day said. “But a huge unknown number is the fish harvested recreationally.” ^ Elizabeth Earl can be reached at [email protected]

Providers await impacts of Medicaid cuts; dental services axed

Gov. Michael J. Dunleavy’s cuts to the state Medicaid budget have providers holding their breaths as they wait to see the impacts. Dunleavy vetoed about $58 million of general fund support for Medicaid programs from the Legislature’s enacted budget on June 28. The Legislature, divided between special sessions in Wasilla and Juneau, failed to override the vetoes, and so the cut stands for now. Because Medicaid is a federally matched program, the dollars the state cuts lead to forfeited federal dollars as well. The $58 million general fund cut is compounded by those federal dollars, meaning at least $77 million less in total. Though there’s no immediate impact for hospitals, but one of their concerns is for the end of the next fiscal year, when money starts running out to reimburse providers. The state suspended payments for about two weeks in June due to a Medicaid funding shortfall, forcing hospitals to wait until the turnover of the fiscal year to be paid. While hospitals are again being paid, there’s the possibility that if funding is cut, the suspension could go on for longer next year, said Jeannie Monk, senior vice president of the Alaska State Hospital and Nursing Home Association. “Right now, in terms of hospitals and Medicaid, everybody’s okay,” she said. One Medicaid service would be eliminated entirely if the vetoes stand: adult preventive dental medical coverage. Up until this year, Medicaid recipients were able to access preventive dental services such as cleanings and X-rays. Dunleavy vetoed $27 million supporting the program, which would stop the preventive program, though emergency situations would still be covered, according to the Alaska Department of Health and Social Services. Providers say it’s more than a luxury. During the regular session, legislators and providers argued for the retention of the program, saying it was an essential part of preventative health and provided opportunities for people to encounter the medical system who might not have otherwise gone in for a doctor’s appointment. Without the benefit, there’s a concern that those patients will just wind up in the emergency rooms with abscesses and acute dental conditions, Monk said. The same is true of the homeless population, with the vetoes applying to social services that help run homeless shelters. For patients at federally qualified health centers, that means paying a sliding scale fee. Though that fee reduces the patient’s cost, it’s still about 25 percent of the total charge, said Jon Zasada, the policy integration director for the Alaska Primary Care Association. “I think a lot of folks know that once you start doing the cleaning, fillings, and other procedures, it becomes a lot more expensive,” he said. “Let’s say a cleaning or a tooth pulling … a patient could easily have a bill that at full cost is multiple thousands of dollars, and then they would be responsible for $1,000, which they generally are not able to pay.” Other states who have cut their preventive dental services for Medicaid have studied and tracked increases in emergency room visits for dental reasons, Zasada said. Though that isn’t something Alaska has done in the past, it’s something the APCA will be looking into, in part because of the inefficiency of treating those problems in an expensive place like an emergency room, he said. “Certainly an abscess or an infection, when treated in an emergency room, is far more expensive than when it might be under control because someone has access to preventative care,” he said. At hospitals, those patients would be eligible for financial assistance, or charity care. Hospitals generally have to eat that cost later. That’s not the case for federally qualified health centers; they often have grants to help cover that shortfall from the sliding scale fee. But with more patients not able to pay for services, they may have to rely more on those backup funding sources. For the Anchorage Neighborhood Health Center, that means probably looking for more grants to support their services and relying on patients who come with private insurance, said Tammy Green, the CEO of Anchorage Neighborhood Health Center. “We have figured out that we have a fair amount of our dental patients that are on Medicaid with our dental benefit,” she said. “We’re going to have to figure out where else to shoulder that in our business.” The Anchorage Neighborhood Health Center has integrated medical, dental and behavioral care, and patients who come in for dental services are frequently referred for medical services and vice versa. Without the dental benefit, patients may not be as likely to receive care in the first place, which may lead to more serious conditions down the road and may hamper their ability to get jobs. Green said a number of the patients who have had dental services have written to the clinics and said oral care played a role in their ability to be employable by correcting their speech or smiles. The other problem is that the caseload may go up as other providers in the area stop taking Medicaid patients, she said. “I think the other piece about these cuts is that in our community, the dentists will no longer be able to see the Medicaid patients and we are going to be deluged, but more importantly, I think the hospital emergency rooms are going to end up (seeing these patients),” she said. The House Finance Committee, meeting in Anchorage July 15, introduced House Bill 2001 to reinstate many of the cuts from the line-item vetoes, including Medicaid, and using remaining state funds to pay the Permanent Fund dividend. Zasada said the APCA hadn’t formally endorsed the bill, but “anything that would reinstate funding for broad health care services amongst all of the other things, we are supportive of.” During a press conference July 15, Dunleavy said his administration hadn’t had time to review the House’s new bill yet but planned to continue discussions with legislators later in the day. Elizabeth Earl can be reached at [email protected]

Cultivators still seeking changes to cannabis excise tax

Questions continue to bubble up about potential changes to state cannabis taxes to keep the current structure from hampering business in the future. Alaska voters legalized recreational marijuana use in 2014, but it took about 18 months for the first cultivators to be licensed and open their doors. When they did, they began paying into the cultivation tax that Alaska assesses on commercially grown marijuana. Generally, any part of bud or flower is taxed at $50 per ounce and the remainder of the plant is taxed at $15 per ounce. That tax is assessed entirely on weight, rather than scaling with price. According to growers, that’s going to be a problem. From the beginning of the program through April 30, the state has assessed more than $28.5 million in taxes. That’s just the cultivation taxes, as sales taxes are assessed by local governments. As cultivators have ramped up production to meet sales demands — retail sales reached $130.4 million in 2018, up from about $57.5 million in 2017 — that tax amount has gone up as well. Cultivators have had to account for it in their businesses and so far have been able to do so, in part because with limited supply, the price has stayed relatively high. That’s not always going to be the case, though, said Jana Weltzin, an attorney representing cannabis businesses through the firm JDW Counsel. “That price will go down because supply will go up, and the demand will stay the same,” she said. In a presentation to the Marijuana Control Board, she presented a case for the Legislature to consider changing the way taxes are assessed in the future to prevent the strangulation of businesses. Based on Notice of Violations, some businesses aren’t even keeping up with their taxes now, she said. The Marijuana Control Board does not have any control over tax policy; the Legislature has to set it by statute. Weltzin said she recognized that but wanted the board to be informed of the problem so they could help educate legislators and advocate for a policy change. Since the inception of the program, cannabis-related businesses have hired many of their own employees but have also led to work generated in ancillary businesses. Between the taxes and indirect economic impacts, the businesses have stimulated enough activity to create a return of about $3 per dollar spent, much at the local level, she estimated. But looking forward, the inflexible tax structure may put excessive pressure on cultivators. Because Alaska assesses the tax based on weight, the amount that will be taxed will not change. The sale price will, and Alaska should respond by revising its tax structure to not jeopardize businesses, Weltzin said. She pointed to states like Nevada, which balances its tax revenue from cannabis between a 15 percent excise tax and a 10 percent sales tax. Colorado splits its revenue evenly, at 15 percent on both an excise and a sales tax, according to the Washington, D.C.-based think tank the Tax Foundation. Alaska, on the other hand, set a dollar amount per ounce rather than on a percentage. “We are the only solely based weight excise tax,” Weltzin said. “We maybe need to bob and weave and adjust our approach.” In a hypothetical example, she noted that a rough average of costs per month for a 5,000-square-foot cultivation facility at about $97,300 per month, not including rent and advertising. Based on the average sales price of $2,800 per pound, that leaves about $31,500 in profit to cover items like rent, advertising and local taxes. That doesn’t go a long way, and once the price begins to go down, that would cut into the profit. She suggested an approach like a 10 percent tax on sales from cultivators to manufacturers and a 10 percent tax on sales from manufacturers to retailers, but emphasized that this is not an industry-generated idea — it was just to get the conversation started, she said. “If we get tagged as the industry that doesn’t fulfill its tax obligations, most of the people aren’t going to understand that economically, with an inflexible price floor like we’ve set here with $800 per pound, it’s not possible,” she said. “While we strive to make the state money, the state needs to be our partner. The state needs to move and ebb and flow with the market like we do.” Board member Loren Jones said that while he understands the situation, consumers ought to be paying the taxes in the retail price because it should be built into cultivators’ business plans. The Legislature is unlikely to want to see the tax revenue go down, he said. In the case of local governments, businesses have to plan around local retail taxes when planning prices and expenses, he said. “If (businesses) say they can’t make money if they pay (local governments) the 5 percent, they’re doing it wrong,” he said. The Alaska Marijuana Industry Association hosted a call-in on the same topic on July 15 night and sent out a call for industry stakeholders to send in comments to the industry organization on the topic before July 22 to work on a proposal to send to the state. ^ Elizabeth Earl can be reached at [email protected]


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